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Special Section Sponsored by Target Markets Program Administrators Association Meadowbrook Insurance Group 2007 has been a landmark year for Meadowbrook Insurance Group. Following six consecutive years of increased net income, Meadowbrook posted record net income in 2006, generating and managing over $700 million in premiums. In April 2007, A.M. Best Company upgraded the ratings of Meadowbrook’s insurance carrier subsidiaries to “A-” (Excellent). The upgrade reflects Meadowbrook’s improved underwriting and operating efficiencies, solid capitalization, and expertise in the alternative risk market. Archie McIntyre, senior vice president of Meadowbrook’s business development division, expresses that the company is well positioned to continue growing and prospering. “We are very pleased with the rating upgrade. With our unique capabilities, strong reputation, and now our “A-” rating, we are attracting solid opportunities in the specialty program business sector.” Meadowbrook owns and operates four insurance carriers, plus an offshore rent-a-captive facility. The company has 23 full-service regional branch offices and employs over 650 people. Meadowbrook focuses on small- to-mid-sized commercial property/casualty programs. “We seek niche books of business from program administrators, specialty agents and associations,” says McIntyre. “Our major lines of business include workers’ compensation, commercial package, and professional liability programs.” Meadowbrook actively seeks new program opportunities. “We want to form long-term business relationships by tailoring products to our clients’ needs and gaining strong loyalty through excellent service levels,” stresses Jim Mahoney, leader of Meadowbrook’s regional field operations. Archie McIntyre says new insurance programs are being reviewed almost daily. “We see a growing trend of retail agency books turning into specialty programs. We have the flexibility to accommodate both small and large programs. Given the right attributes, we will look at a $2 million program and give it the same careful attention and resources as a $20 million program.” “We also work with many larger MGAs and recognized program administrators, often operating on a portfolio approach to accommodate a firm’s multiple program needs,” adds Joe Mattingly, senior vice president of Meadowbrook’s Insurance Company Operations. “Additionally, our back room operations provide full third-party administrative services for other unaffiliated carriers, select programs, public entities, and self-insured groups,” added McIntyre. “Meadowbrook’s infrastructure offers every service function necessary.” Through its regional operations, Meadowbrook manages numerous distribution networks nationwide. Together, these diverse agency networks provide attractive growth opportunities for expansion. Jim Mahoney explains, “We work in partnership with other unaffiliated carriers to distribute their insurance products through our regional networks. Meadowbrook has the financial ability to risk share in the underwriting with our fellow carriers, where the opportunity presents itself.” “Specialty programs which utilize an alternative risk mechanism, such as risk sharing, continue to grow in importance,” according to McIntyre. “We help our clients assess the risk/reward benefits when forming a risk sharing partnership with Meadowbrook. Our partners receive compensation not only through commissions, but also by sharing in underwriting results. This provides a financial incentive to ensure profitable business by selecting the best risks. By working with us, groups and associations can also gain further control of their businesses and participate in the favorable results of their risk management efforts.” This past July, Meadowbrook successfully completed a new equity offering of 6.4 million shares of the company’s common stock, raising approximately $58.6 million in new capital. “With our recent A.M. Best upgrade and the opportunities present in the market, we believe it was an appropriate time to raise and profitably deploy new capital,” comments Bob Cubbin, Meadowbrook’s president and CEO. “The proceeds from the offering are used to support new program growth and strengthen our balance sheet. We also actively look for select acquisitions as we seek to add to our fee and commission-based revenue streams. These include program administrators, specialty agencies, and third-party administrators.” Meadowbrook envisions its role as well beyond that of just another insurance carrier. “We’re more than that,” says Phil Gajewski, assistant vice president of business development. “We’re a risk management company that focuses entirely on specialty programs. We have an agency orientation, history and culture. We couple that with an expertise in all insurance company services necessary to manage profitable program business.” Archie McIntyre sums up Meadowbrook’s 2007 positioning within the insurance industry. “We firmly believe we can assist America’s top program administrators by bringing our expertise to the equation.” → |
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